Staying on Top of Home Insurance: What Really Matters

Owning a home is one of the most significant investments in life. Besides the purchase price, homeowners insurance should also be considered, especially when financing is through a mortgage. The cost of an insurance policy can vary significantly and depends on several factors. The basic cost of such insurance often depends on the location. In the U.S., for instance, premiums differ from state to state. According to Progressive, the national average ranges between $999 and $1,655 annually, while a nationwide analysis cites a much higher amount of $2,601. Regions like the tornado-prone Midwestern states of Nebraska, Oklahoma, and Kansas, as well as Florida and Colorado, stand out, where premiums can range from $4,009 to $5,858 annually. In contrast, residents of Hawaii or in New England and the Mid-Atlantic states often pay significantly lower premiums, ranging from $613 to $1,384 per year. Various factors determine the level of insurance costs: the age and condition of the house, the location and its risk of natural disasters, as well as the covered sums insured all play a role. Individual components such as previous damage claims and the homeowner's creditworthiness are also included in the calculation. Even the keeping of certain dog breeds can have an impact, due to potential liability claims in bite incidents. One way to reduce insurance premiums is to compare multiple offers from different providers. Raising the deductible in the event of claims or using insurance discounts through security measures are additional strategies to reduce costs. A good credit score also pays off, as it is used by many insurance companies as a risk indicator.